Austerity vs. growth

Isn't that somewhat common between countries, though? I'm pretty sure that we don't automatically recognize degrees from many other countries as well (I know of several Russian immigrants who can't work in their fields of study here due to this, for example).

The greek costitution prohibits the existance of knowlwge institutions that operate for profit.

Ok, well, if they want to write such stupid shit into their constitution I guess they deserve some of the results. Do they stick their fingers in their ears and go "lalalalalalala" as they walk by them?

Ok, well, if they want to write such stupid shit into their constitution I guess they deserve some of the results. Do they stick their fingers in their ears and go "lalalalalalala" as they walk by them?

They operate under a law that in essence says that they act like "tutor" instituions, which can offer no validity in their academic credentials.

If you go and study in one of these, you will never be accepted as a teacher in a public school. The private sector on the other hand has no obligation, except for some specific cases like haelth, to treat graduates of these schools as inferior to those coming from public universities.

Note that the private univerities in Greece do not offer classes in medicine, engineering, chemostry etc. They mainly offer classes in MBA, few of them computer science, 3d arts etc.

Aspiring academics who studied at private universities in Greece may find it easier to gain work abroad than at home, because the Greek government does not officially acknowledge their qualifications.

“Our private universities are not recognized by the Hellenic Republic, so graduates are not able to take jobs in public universities. They have to go before a committee, which will assess whether their qualification is suitable, and can be recognized. Bureaucracy is terrible for all Greek students,” said Tzogopoulos.

Those who studied abroad may also struggle to find work in Greece’s universities, as the government does not recognize any degree awarded outside of Greece, even those from other European Union countries.

Isn't that somewhat common between countries, though? I'm pretty sure that we don't automatically recognize degrees from many other countries as well (I know of several Russian immigrants who can't work in their fields of study here due to this, for example).

Although private universities are not big in Europe in general. I'm not sure what the fraction of students in Greece is that receive degrees from private institutions but it's likely to be very small, a couple percent if not less. I could be wrong about that but that's typical for European countries.

It's a bad policy for sure, obviously you want some form of accreditation for private universities, but it isn't likely to be a huge issue since the schools that produce civil servants are all state schools.

Do you think people who support Austerity (like the German Chancellor) are dilusional (i.e. they really think that it will fix the economy) or they're just phony greedy people who will do and say whatever they can to keep their unpopular requirements for loans in place?

Although private universities are not big in Europe in general. I'm not sure what the fraction of students in Greece is that receive degrees from private institutions but it's likely to be very small, a couple percent if not less. I could be wrong about that but that's typical for European countries.

It's a bad policy for sure, obviously you want some form of accreditation for private universities, but it isn't likely to be a huge issue since the schools that produce civil servants are all state schools.

Quite a few (obviously not all) private universities over here are actually for people that could not get into/handle a public universities so the quality of their education is not very high...

Angela Merkel, Germany’s chancellor, on Monday warned Athens to stick to the reform plans and budget targets agreed under its international bailout plan as financial markets and EU policymakers grappled with an anti-austerity backlash spreading across the eurozone.

This just sounds... delusional. What do greek people have to fear if they're already unemployed and their pensions are taken away? "You'd better stick with our extortionate agreement, or we're gonna get mad!" She comes across as dictatorial.

Well, it follows that she doesn't have any reason to care what the Greeks think of her or want her to do.

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This just sounds... delusional. What do greek people have to fear if they're already unemployed and their pensions are taken away? "You'd better stick with our extortionate agreement, or we're gonna get mad!" She comes across as dictatorial.

The Greek standard of living is still well in the top half of the world. They have plenty further to fall if they decide they'd rather be petulant then play ball with the people paying for their lifestyle.

Well, it follows that she doesn't have any reason to care what the Greeks think of her or want her to do.

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This just sounds... delusional. What do greek people have to fear if they're already unemployed and their pensions are taken away? "You'd better stick with our extortionate agreement, or we're gonna get mad!" She comes across as dictatorial.

The Greek standard of living is still well in the top half of the world. They have plenty further to fall if they decide they'd rather be petulant then play ball with the people paying for their lifestyle.

1st off that's little silly..you know that people compare their lives to what they had, not to the 'worst possible living conditions in the world'.

2nd, you can understand how an unemployed Greek person or a student who has virtually no chance of finding employment would feel you claimed to be "supporting their "lifestyle"".

She should only care if she wants a real solution. Of course if she doesn't care what they think and just wants to keep forcing austerity on countries, she should be prepared for a radical response at some point...of course she'll probably go "How did we not see this coming?" when Greece truly defaults or leaves the Union or whatever they end up doing.

The thing is that it is probably best for Germany that Greece leave the Union. Of course she can't go out and say that because Germany is supposed to be the biggest supporter of the EU project to atone for WWII. So getting Greece to quit rather than kicking them out looks like a rather smart strategy.

The thing is that it is probably best for Germany that Greece leave the Union. Of course she can't go out and say that because Germany is supposed to be the biggest supporter of the EU project to atone for WWII. So getting Greece to quit rather than kicking them out looks like a rather smart strategy.

Well, it follows that she doesn't have any reason to care what the Greeks think of her or want her to do.

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This just sounds... delusional. What do greek people have to fear if they're already unemployed and their pensions are taken away? "You'd better stick with our extortionate agreement, or we're gonna get mad!" She comes across as dictatorial.

The Greek standard of living is still well in the top half of the world. They have plenty further to fall if they decide they'd rather be petulant then play ball with the people paying for their lifestyle.

1st off that's little silly..you know that people compare their lives to what they had, not to the 'worst possible living conditions in the world'.

2nd, you can understand how an unemployed Greek person or a student who has virtually no chance of finding employment would feel you claimed to be "supporting their "lifestyle"".

She should only care if she wants a real solution. Of course if she doesn't care what they think and just wants to keep forcing austerity on countries, she should be prepared for a radical response at some point...of course she'll probably go "How did we not see this coming?" when Greece truly defaults or leaves the Union or whatever they end up doing.

Greece can default and leave the Euro zone. Or they can take the EU loans and agree to the conditions. What they can't do is dictate the rest of the Eurozone how much money they have to pay to subsidize Greece.

Also the idea that the evil EU / even more evil Germany is forcing poor Greece into a horrible recession and nobody is giving them any money to stimulate growth is somewhat strange. Here's a comparison of the current aid packages to the post WWII Marshall plan (from here: http://www.euinside.eu/en/analyses/grow ... high-price):

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The Communication from the Commission recalls that the total amount of EU financial support for Greece, including the bailout loans, write-downs on private sector debt holdings and grants from EU funds, is close to 380 billion euros. This unprecedented support is equivalent to 177% of the Greek GDP (the US Marshall Plan for post-war reconstruction was equivalent to 2.1% of GDP of the recipient countries)

It just seems pretty obvious that austerity does not help countries recover and likely hinders it; it would be like me lending my deadbeat brother enough money to pay off his debts and pay for ramen noodles...it would take 20 years for him to "pay me back" at that rate, but if he got a proper job and economically recovered he could pay it in a fraction of the time.

Or rather, they got Greece to give them financing through all these exotic instruments. The Frontline documentary interviews a banker who worked for Morgan Stanley at the time in London. They said when the news of Greece's debt became known, the bosses were saying you better get down to Athens to see if they could get in on some of those deals.

Or rather, they got Greece to give them financing through all these exotic instruments. The Frontline documentary interviews a banker who worked for Morgan Stanley at the time in London. They said when the news of Greece's debt became known, the bosses were saying you better get down to Athens to see if they could get in on some of those deals.

Gawd, yes. If you can create & securitize a born to fail deal, all the better to bet big against it in synthetic derivatives. It's a win-win if you're sufficiently amoral, or immoral, depending on how you look at it.

Right. That money is gone now. Why make the same mistake over and over?

Agreed, in my opinion we had two ways out:

1. We should have let them go. That way they would have gone through severe pain but would eventually crawl out.2. We should have just zeroed the debt and be done with it (and yes, demand reforms or else out you go with the tab re-attached). It would at least keep their growth prospects intact, would have cut the debt burden and would have stopped the hemoraging which we know have to refinance every 6 months.

And yes, both ways are completely unrealistic politically... so we just keep Greece on life support, which only costs us more and more.

so we just keep Greece on life support, which only costs us more and more.

Not going to be forever. Their election this week suggests that the voters wish to throw off the yoke of bailout oppression, so a big nose thumbing at the rest of the EU, and an exit, are probably not too far off anymore. The financial markets are already pricing that in.

Right. That money is gone now. Why make the same mistake over and over?

Agreed, in my opinion we had two ways out:

1. We should have let them go. That way they would have gone through severe pain but would eventually crawl out.2. We should have just zeroed the debt and be done with it (and yes, demand reforms or else out you go with the tab re-attached). It would at least keep their growth prospects intact, would have cut the debt burden and would have stopped the hemoraging which we know have to refinance every 6 months.

And yes, both ways are completely unrealistic politically... so we just keep Greece on life support, which only costs us more and more.

Well that was my point earlier, politically it is impossible for Germany to kick out Greece, but if Greece were to quit on its own - that would be ideal from a German perspective.

So while the French election was bad news in Berlin, I think the Greek one was good.

Meanwhile, more calls for growth instead of austerity seems to have backed Merkel and the Germans into a corner. ECB is talking about doing more to defend the Euro and help the countries in crisis. You would think that doesn't mean they prescribe the same thing they've been doing to Greece for the past couple of years.

The greek costitution prohibits the existance of knowlwge institutions that operate for profit.

Ok, well, if they want to write such stupid shit into their constitution I guess they deserve some of the results. Do they stick their fingers in their ears and go "lalalalalalala" as they walk by them?

That was not anymore convincing than when it was posted by a troll in the 2012 Election thread.. mayhaps the adoption of the Euro and their new trade and economic assistance from the EZ had something to do with mildly recovering from a huge drop and that they have retarded the recovery by going austere? Surely the UK and the rest of Europe are better examples?

Yeah we have the example of what's happening in the UK, which seems like a much better comparison to the US, where GOP-imposed austerity has been subtracting from the monthly jobs numbers for about a year now, in the form of direct govt. job losses (particularly at state and local levels) as well as potential losses in the private sector derived from loss of business from those govt. employees who lost their jobs.

That was not anymore convincing than when it was posted by a troll in the 2012 Election thread.. mayhaps the adoption of the Euro and their new trade and economic assistance from the EZ had something to do with mildly recovering from a huge drop and that they have retarded the recovery by going austere? Surely the UK and the rest of Europe are better examples?

Which "new" trade and economic assistance might you be thinking about? Hint: there wasn't any. Estonia is a EU member since 2004 (and hence a member of the common market), and receives and contributes the usual EU funding based on 5-year plans, of which the last one started in 2007.

In fact, the only particularly new thing that happened to Estonia after the begin of the global financial crisis and their entry in the Eurozone is that they had to contribute to the EFSF and now the ESM, which means new spending, not new income.

As you seem to buy into trickle down, explain how giving tax breaks to wealthy individuals and corporations that are already sitting on piles of unengaged money because they don't have any good investments to make due to lack of demand with help create that demand, particularly when such tax cuts are paired with cuts to government in which many government workers are laid off, thus lowering demand even more.

That plan is insane. We need demand for goods and services to rise which then causes the need for more workers, which in turn means more demand as more money enters the lower and middle classes. It is the lower and middle classes, the things being gutted by thirty years of focus on wealth building for the already wealthy, that drives demand as they spend all or most of their income on goods and services whereas the wealthy only spend a small fraction of their wealth on goods and services.

Is Estonia the only retort that the Austrian devotees have to Krugman and other critics of austerity?

Because if that's the only example they can come up with, that's like conceding the argument, isn't it?

Estonia is functionally a city state. I am not at all sure that Estonian economics mean diddly squat as a comparison to Spanish, British or American economics as those are large, complex nations, not city states.

As you seem to buy into trickle down, explain how giving tax breaks to wealthy individuals and corporations that are already sitting on piles of unengaged money because they don't have any good investments to make due to lack of demand with help create that demand, particularly when such tax cuts are paired with cuts to government in which many government workers are laid off, thus lowering demand even more.

That plan is insane. We need demand for goods and services to rise which then causes the need for more workers, which in turn means more demand as more money enters the lower and middle classes. It is the lower and middle classes, the things being gutted by thirty years of focus on wealth building for the already wealthy, that drives demand as they spend all or most of their income on goods and services whereas the wealthy only spend a small fraction of their wealth on goods and services.

And? How do you want to generate that demand?

Greece's problem was there simply was no industry outside of government corruption. Once the government is getting into trouble, so does the economy.Portugal is similar. France, too. And Italy is just a basket case.

The broken window fallacy is all over the place with Krugman's argument. Government must not generate significant demand for the economy (only in the areas of natural infrastructure monopolies can such a case be made). Once you start going down that track you are back to command economies and Communism. And we have seen how well that works.

Spain's economic activity was a one-trick pony of housing construction. And the bad part is that this economic sector (and the fucking Euro) actually crowded out other previously healthy industries (Tourism, Car manufacturing, Aerospace). You cannot create demand as long as the housing implosion is prevented from running its course. Any money spent, will just disappear in that economic black hole and will merely re-capitalize bankrupt housing lenders. The Spanish housing industry is dead for a long time, why throw good money after it? And why should anyone care about bankrupt Spanish housing lenders. There more than enough market players out there to continue lending.